£120m boost for Metro after accounts blunder

SCANDAL-HIT Metro Bank is back in investors’ good books after winning a £120m grant to boost business lending, despite an accounting error which has piled pressure on its boss.

Metro is the biggest winner so far from a £775m fund designed to boost competition in corporate banking and weaken the stranglehold of the big High Street players.

While its shares climbed 9.7pc, or 126p, to 1430p after it won the grant, Clydesdale and Yorkshire Banks’ owner CYBG slid 5.2pc, or 10.2p, to 187.1p as it sheepishly conceded it had not got a penny of the money.

But critics said Metro should not have been given the cash because of questions over its finances.

Earlier this month the lender admitted a pile of property loans were more risky than previously thought, a mistake which analysts believe could force it to tap investors for another £300m.

Metro’s problems were made worse when the Mail revealed this problem had been discovered by regulators at the Bank of England, not through an internal review as chief executive Craig Donaldson initially claimed.

Labour MP John Mann, a member of the Treasury Select Committee, said the debacle should have disqualified Metro from getting the competition grant.

He said: ‘There are now serious questions over Metro’s growth, its accounting policies, and the position of its chief executive.

‘Giving money to Metro under these circumstances undermines the push to improve competition in banking.’

The business banking fund was set up using money supplied by the Royal Bank of Scotland, which was ordered by regulators to improve competition in lending as a condition of its £46bn taxpayer bailout in 2008.

Internet- only lender Starling Bank got £100m and fellow digital bank Tide, in partnership with Clearbank, was given £60m.

Trade talks between the US and China pushed copper prices to their highest level since last July, causing London’s mining giants to rally.

As the price of the metal shot above $2.90 per pound, Glencore edged up 2.8pc, or 8.35p, to 308.85p,

Anglo American climbed 3.4pc, or 67.2p, to 2057p and BHP Group rose 2.2pc, or 40p, to 1827.4p.

Investors’ hopes that President Trump and his Chinese counterpart Xi Jinping would soon end the drawn-out trade war rubbed off on other metals firms. Steelfocused Evraz jumped 3.5pc, or 18.8p, to 550.2p.

Oil was also at its highest level since last November, as traders hoped better relations between the US and China could boost slowing global economic growth.

Brent crude was trading around 0.4pc higher over the day, at $67.10 per barrel, and the optimism helped push the FTSE 100 up by 0.2pc, or 11.21 points, to 7178.6.

Among the stock market tiddlers, fishing tackle chain Angling

Direct – once a stock-market darling but whose shares have been sinking for the last several months amid wider retail gloom – confirmed it was in talks to buy rival Chapmans Angling.

Chapmans specialises in carp fishing, and sells products such as the Carponizer Carp Girls wall calendar featuring ‘ Page Threeesque nudity’. Angling Direct said there was no certainty it would buy the company, but shares dipped 1.4pc, or 1p, to 68p.

Reach4entertainment fared better as it revealed it had bought Sold Out, a London advertising agency whose clients include entertainment company Live Nation and Cirque du Soleil.

Promoter Reach4 will pay between £4.2m and £10m, depending on Sold Out’s performance over the next few years. Shares edged up 8pc, or 0.1p, to 1.35p.